Just like everything else
Take Gas prices, as soon as the wholesale price goes up, so do our bills, when the prices goes down what happens, nothing, its all about profit making, there is no real surprise here, rich get richer.
The cost of hard disk drives remained reassuringly expensive in the opening four months of this year despite product availability improving. Long gone are the tales of a declining HDD sector hit by product shortages - sales through distribution were up 36 per cent and 78 per cent in Western Europe and the UK respectively from …
This is worse. We are fast approaching a duopoly as WD & Seagate gobble everything in sight. Its in both company's interest to operate an informal cartel. They can gameplay this without having to lift a phone or email a third party. The sprats can just coast on the droppings in the hope they will be gobbled up for a good price soon.
We need a major new entrant as a game changer. Can China rock the boat here?
Except in California... The price of gas continues to go up because... 1) The refineries have to change over from "winter gasoline" to "summer gasoline", and 2) refineries have to be taken down for maintenance and repair at the same time. Three out of five refineries in the SF Bay Area went down at the same time a few weeks ago, and the price of gas went UP another 20¢ when the rest of the country was falling. The "national average price" for gasoline is a joke in California... add another 75¢ to $1.00 per gallon any time of the year...
Paris, because I need something better to look at than the price of gasoline... or a magnum of wine would suffice too.
Larry, you should understand that when we non-americans use the word "gas" we are using it in its true sense. I cannot understand why intelligent people persist in using it as an abbreviation for gasoline without any indication that it is an abbreviation. ("gas." might be acceptable.)
Is it profiteering or bringing prices back into line to make their business sustainable.
Pre floods I got a 2Tb external drive for under 100 Euros(*). Obviously along the way a profit was being made but even with the volume of sales disks make I find it hard to see that the profit could be large. So maybe this is just a realignment of price.
(*) Just checked current prices and they are not significantly more.
External drives have weirdly been relatively unaffected by the pricing. Before the floods I bought a 2TB WD Caviar Black disk for about £90, in the middle of the floods, the price for the same one had gone up to around £210.
They are now £155 ish for the same model. So, prices are still very much higher than they were.
External Bargins i called them, although I didn't always get the exact drive I wanted using them for desktop or notebook products they were fine and meant I didn't get so badly ripped off. Althought the pile of plastic cases is a tad annoying.
No surprise at all. Prices went up while retailers still held stocks they'd paid a fraction of the price for.
Many external drives never went up in price, so at one stage I was buying Freecom drives, ripping them apart (1 minute job, only scissors required) and using those because the prices were nearly "normal".
It was sheer profiteering and still is. Cost of manufacture doesn't suddenly go up because one factory goes offline. It's the same rubbish we have to put up with in the markets when petrol prices go up. Just a load of suits manipulating things for their own profit.
> Cost of manufacture doesn't suddenly go up because one factory goes offline.
Well, it can do. If an industry loses a percentage of it's supply AND the other, unaffected, suppliers need to step up their production to meet demand there IS a cost to doing that.
These days most manufacturing runs with very little slack. If a plant is designed to make 100,000 gizmos a week then it'll be making that many. Asking for 110,000 gizmos won't just be a case of turning the production line speed up to 11. It'll need more investment, more raw materials (or parts: from subcontractors who in turn are working at 100% capacity), more workers - to be trained, more factory floor space to be built, more storage packing clean-rooms and testing. In fact: more of everything.
If the expectation is that when the "lost" production is restored, all that extra investment will be standing idle you can't really expect the plants' owners to finance that expansion without wanting to recoup their costs.
Yep picked up a 120GB SSD for £65 last week. Last years model but Windows now boots in 20 seconds.
Since the floods we've basically moved over to SSDs for system drive replacement and just use the couple of 1TB we had for data dumping.
The floods and price hikes was the push we needed to migrate. So less HDD sales from us going forward.
It will be interesting to see a graph of sales of hard drives when they start properly blocking torrent sites (other than just one), I bet sales will plummet as people have nothing to fill their 2TB hd's with (as it would cost a fortune on iTunes to fill)....
So in other words, they are shooting themselves in the foot by not taking as much profit right now (which you can do if you lower your prices you know!)
Externals perhaps. Which were ironically the drives that did not see prices rise by much.
The main market for bare drives is enterprise/business, not freetards. Bare drives were hit the hardest. Stick an enclosure around the drive and add a SATA to USB interface and suddenly the costs were actually far lower!
...so you are basically arguing that much of the demand for bare drives is relatively inelastic.
Businesses are probably have much less flexibility when it comes to avoiding overpriced kit. While they could certainly try to avoid new acquisitions, their purchases are more driven by "need" versus "mere want". So the petrol analogy fits pretty well for the business segment.
It doesn't for the consumer segment. It's a luxury good. If you price to too high people say "why bother" or "I think I will wait a bit".
Thus the the differences in prices.
Although, if my array fills up and I can't afford an upgrade then I stop buying DVDs.
.............to the same level of production capacity that they had before? In order to shore up prices and therefore profitability? Has anyone seen anything on the levels of planned rebuilding? It would be interesting to compare that with pre-flood production capacity. I also have to say that the difference between what happened with the prices of external and internal hard drives (mentioned by several here) is indeed very peculiar.
I doubt not rebuilding is an option. Given that states want to keep even more information about us, requirements for telecos and ISPs to save logs(*) online for longer, the mysterious cloud and services such as youtube then the market for disks is, for the foreseeabele future, almost limitless.
(*) And once they have to save content it will be limitless, no almost about it.
that's why they also dropped warranty lengths.
All drives manufactured after january 1st, 2012 have the warranty cut down. You won't see anymore drives shipped directly from manufacturer with a warranty of 3 or 5 or more years.
Now Seagate and Western Digital only provide a maximum warranty of 2 years but only on some drives.
I see also many drives from these two that come with only ONE year warranty and they hope they won't be sued by the European Union for ignoring the minimum 2 years warranty mandatory legal requirement across the E.U.
<quote>WD still has a 5 year warrany on the Caviar Black series of drives and RE4 series of drives.</quote>
yea... right.. it's funny that NOW the warranty page on WD's sites loads just fine but back in february/march when i needed it, it didn't LOAD AT ALL! It was showing an error message with an apology about warranty terms not being available.
At that time even the WD Black / RE4 i was seeing for sale had warranties of only 2 years. Maybe they fixed that since then but i was royally screwed over by this thing. :(
Although I can't find anywhere that explains why 2TB and under drives are any better off not being 512 Byte sectored, the flood seems to have ended any production of non-"advanced format" drives and the shortage means no new old stock to be found at any price, so with the new ones, you wind up playing "will this work without me having to spend money on new equipment and software" roulette.
And nobody guarantees any of them for DIY TiVo space embiggeners.
Where's the icon with the threaded tapered metal cylinder when you need it?
Firstly, with margins traditionally low in the hard rive industry, nobody is dropping half a billion dollars on a new factory capable of delivering drives with a lower manufacturing cost. This situation isnt going to change any time soon.
Secondly, a lot of tooling was destroyed in the floods, for which no manufacturer now exists. A lot of companies making hard drive test equipment/tools have gone bust in the last 5-10 years (replacement cycle was too long for them), so replacing flood damaged test equipment has proved difficult/costly.
Finally, over at the 360 blog (http://tinyurl.com/clqrotb) their little diagram shows the market situation quite clearly, with only 3 players there is little incentive to push margins down further. All eyes are now on Toshiba to see what they do in the 3.5" space, as that is probably the only place you'll see a company with an incentive to "do something".
Profiteering... Well unfortunately it's business 101. Supply and demand, been around since ancient times and isn't likely to go away. Bare drives are just a commodity, same as fuel. Demand outstrips supply prices go up, supply outstrips demand (the stockpiling before the floods had happened) prices are low.
This is how Opec regulate their prices for Oil.
The prices will only go down, if and when demand for them reduces.
As for the price of packaged, external drives. Well these aren't seen as much as a commodity, they have fixed retail price and the supplier had hold of the bare drives a long time before the floods to create their end product. They don't have so much of a fluctuating price as standard components which can change price daily.
A week after the flood I quickly bought up a 30TB array as the price was still list price compared to the already soaring HD prices.
HDDs are a dead tech, still some twiching in the corpse, but the writing on the wall is that they will be fully replaced by SSD's once the price-capacity-performance mark hits critical mass.
If you are a HDD manufacturer, the only life extending option is to make your old tech HDD as competative as possible versus SSDs, whilst you get your company into a new market. This is NOT acheived by having over inflated prices, which will only make business make the jump to SSD storage that much faster.
For further details on brilliance in management decision making, please consult with the board (former) of Kodak or Marconi
I met with one of the major manufacturers recently and they are having to spend a fortune rebuilding their supply chain so that they can survive in the future. Also I think that many more retailers are inflating the price compared to the wholesale price.
There is also the issue of needing to build up a buffer, so even if the market gets back to 100% capacity in production there is still a supply issue in the market.
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